We have a Registered Brand Name and working at different location. We provide all the furniture & infrastructure at every letout at initially.
In our one location some other person( relative ) want to take over the business of particular location but he will work under our brand name.
Our Company is agree and hand over all the furniture & infrastructure & business to him at without consideration and charges lumsum amount on monthly basis.
My Question is Whether we charge Royalty on monthly basis and pay Capital gain on transfer of Fixed assets ?
Or
We make a lease agreement of fixed assets and received lease rent
the party is agree with both the conditions
Please advice what will we do. For Lease agreement we safe the capital gain and enjoy the benefit of Depreciation. on other side if we charge royalty we need to pay capital gain and get registered ourself into service tax act also.
CAclubindia
